Q&A: Categorizing types of denials

Q: What is the difference between a hard and a soft denial?

A: Denials can be classified as soft or hard denials. A soft denial represents a temporary impact on cash flow and has the potential to be paid in full. The facility will need to invest resources to follow up, but an appeal is not required. A soft denial can usually be overturned by submitting a corrected claim or by submitting additional information. A hard denial represents a loss of revenue that must be written off, and therefore an appeal is required. Denials can also be classified as preventable or unpreventable. Examples of preventable denials include the following:

• Failure to timely notify the payer of unplanned outpatient or inpatient hospital services provided
• Incorrect date of service and /or billing status entered into the billing system of record
• Initial and/or continued clinical review not submitted timely to the payer
• Medical record not submitted to the payer by required submission date
• Pre-certification not obtained prior to a radiology service or any service that requires prior
• authorization

For more information see The Contemporary Guide to Patient Financial Services.